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Merrill Lynch Supernova Case Solution

Solution Id Length Case Author Case Publisher
837 1499 Words (4 Pages) Rogelio Oliva, Roger Hallowell, Gabriel Bitran Harvard Business School : 604053
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The case discusses newly discovered Supernova process, by the Indianapolis, that would enhance the customer experience in retail-brokerage. Supernova is a new way of managing client relationship, through which productivity of each Financial Advisor can be maximized. During its initial pilot test, it showed very valuable results that by implementing Supernova process, the customer satisfaction increased, and operational efficiency improved. The case also discussed the challenges faced during the pilot process and advocates the implementation plan on the whole organization. It also discusses the dramatic rise in customer expectations after experiencing desired customer service. In the end, it discusses the way forward for the implementation of Supernova process, and a recommendation plan to eradicate foreseeable challenges faced by Merrill Lynch in rolling out Supernova.

Following questions are answered in this case study solution:

  1. What does Supernova offer to Merrill-Lynch? Does Merrill-Lynch need Supernova to be successful or grow in the future?

  2. What is Supernova and how is it different from traditional financial advising models? What is the value proposition for customers?

  3. What changes were required to implement the Supernova process—for FAs? For Merrill-Lynch itself? What were the risks and potential benefits for both?

  4. Paint a picture of a Financial Advisor’s day using the Supernova process. How is this different from typical day under the old process?

  5. How would you recommend Merrill-Lynch as a company proceed in rolling out Supernova? What are the challenges and hurdles that must be overcome for it to succeed? How can they overcome these challenges?

Merrill Lynch Supernova Case Analysis

1. What does Supernova offer to Merrill-Lynch? Does Merrill-Lynch need Supernova to be successful or grow in the future?

Supernova is a new way of managing client relationships that provides a business process that was not presented in the Merrill Lynch long ago. Originated in Indianapolis offices, it resulted in performance enhancement of the Financial Advisors and increased the level of customer satisfaction. Before the implementation of Supernova Financial Advisors (FA) were occupied in acquiring more clients, dealing with each client’s problems and lack sense of Customer Satisfaction. In addition to that FAs were disorganized, had poor work life balance, and were continuous in search of new potential Clients as the previous Client left them due to poor customer delivery.

With the implementation of Supernova, FAs had more time to interact with the Client to provide better customer Satisfaction, a limited clientele to focus their energies and with the help of Client Associates they were more managed and up-to-date. Supernova provided a plan, process and discipline to deliver ultimate customer experience.

As far as future growth of Merrill Lynch is concerned, it is of utmost importance that Supernova should be implemented in the organization for future growth and success. Supernova is a cultural shift from conventional brokerage system to more specialize and result oriented management process. Considering the performance of Indianapolis offices implementing same on the whole organization will result in acquiring high-quality clients, improved customer satisfaction, sustainable source of business generation, a well structured process and disciplined and well informed FAs. Though the bitter side of the implementation plan is increase in the client’s expectations, and more dependency on limited customers.

2. What is Supernova and how is it different from traditional financial advising models? What is the value proposition for customers?

In traditional advising model FAs were more focused on getting additional accounts as their compensation package was designed in accordance to a number of accounts generated. Before implementation of Supernova, FAs rarely contacted their clientele on a frequent basis, and were prone to enjoy autonomy of work.

Conventionally, FAs bring Clients through their relationship and professional Alliance, and were more focused on competing with each other. However in new methodology (Supernova) FAs were more concerned to manage a client relationship, customer satisfaction, and limiting client number and focusing on teamwork for better efficiency. Supernova helped in segmentation of customers, provided more administrative support, a rapid response to a problem, and acquisition of high-quality clients.

In terms of the value proposition to customers Supernova FAs were able to promptly respond to the customer problems, each Supernova FA was required to contact its client every month and would schedule a quarterly review contacts beside their two face-to-face interactions. These contacts were the minimum criteria for customer interactions. The objectivity of these contacts was to provide excellent customer service, improve service delivery mechanism, focused customer approach, and to have a better understanding of customers through discipline and process.

Considering the changing landscape of retail-brokerage and increasing competition in the market it was of prime importance to retain customers. The outcome of implementing Supernova was encouraging as mistakes in processing transactions declined; customer satisfaction improved, and revenues increased marginally; thus, making Supernova more desirable to implement it in other regions and to provide ultimate customer experience.

3. What changes were required to implement the Supernova process—for FAs, for Merrill-Lynch itself? What were the risks and potential benefits for both?

Implementing Supernova process requires appropriate steps that could reflect its true essence, and reproduce same results. In terms of FA strong mentorship was required to adopt Supernova quickly without any hassle. It was observed that 20 % FAs were determined to quickly implement Supernova while other 20 % FAs were skeptical about its implication, and rest required at least 2 years of coaching, implementing same in its true essence.

Factor that may cause hindrance in acceptability of Supernova would be the mindset of the FAs. FAs required to conceptualize that Supernova meant to change process, and it’s not software that loaded on their computers would make them Supernova Compliant. Previously FAs had enjoyed the autonomy of work and freedom, to them implementation of Supernova would be a compulsion and hindrance to their autonomy, which harness productivity of FAs.

In context to Merrill Lynch, a full flag framework needs to develop for the implementation of Supernova. Each FA would require a Client Associate to assist him/her in administrative work, so each FA had plenty of time to divert his/her energies to accomplish set objectives. Beside administrative assistance more campaigns should be started to aware FAs about the importance of Supernova. Potential risk associated with the Supernova would be an unwillingness of FAs to accept the program, the partial acceptance which may erode the brand name of Supernova and further cause dissatisfaction among customers. While benefits would be an improvement in operational activity resulting in profitability, customer satisfaction and work life balance of FAs.

4. Paint a picture of a Financial Advisor’s day using the Supernova process. How is this different from typical day under the old process?

Financial Advisors using the Supernova process would have an edge over other non-Supernova FAs as they would have all up-to-date information of the customer. They would have a proper set plan regarding which customers to contact. Also, the hassle of administrative related problems would be handled by the Client Associate, providing considerable time to search for new potential customers.

Supernova FAs would have concise, but significant number of the customers to work with, allowing FAs to handle customers properly and respond and resolve by taking actions promptly. The limited number of customer would result in better customer service, enhanced customer satisfaction level, acquiring high-quality customers, and would divert attention from quantity of accounts to the quality of service provided. Supernova process would also result in generating sustainable business because satisfied customers would produce more referrals. There would be no frequent phone calls and the most considerable factor would be the work-life balance that Supernova FAs could achieve through discipline.

In case of non-Supernova FAs, they had plenty of customers to look after, and predominantly occupied in administrative problems, and had less time to focus on acquiring valuable customers. Due to poor service delivery, majority of the customers would be dissatisfied and switch to other FAs, which might result in declining customer base. The work-life balance would be affected by over burden of customer base, and keeping in-contact with the consumer would become a herculean task. Mismanagement and market errors would be frequent and would result in financial loss.

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